G.R. No. 160093             July 31, 2007

MALARIA EMPLOYEES AND WORKERS ASSOCIATION OF THE PHILIPPINES, INC. (MEWAP), petitioners, vs.THE HONORABLE EXECUTIVE SECRETARY ALBERTO ROMULO, et al. respondents.

PUNO, CJ.:

At bar is a Petition for Review on Certiorari of the Decision of the Court of Appeals in CA-G.R. SP No. 65475 dated September 12, 2003 which upheld the validity of Executive Order (E.O.) No. 102,1 the law Redirecting the Functions and Operations of the Department of Health. Then President Joseph E. Estrada issued E.O. No. 102 on May 24, 1999 pursuant to Section 20, Chapter 7, Title I, Book III of E.O. No. 292, otherwise known as the Administrative Code of 1987, and Sections 78 and 80 of Republic Act (R.A.) No. 8522, also known as the General Appropriations Act (GAA) of 1998. E.O. No. 102 provided for structural changes and redirected the functions and operations of the Department of Health.

On October 19, 1999, the President issued E.O. No. 165 "Directing the Formulation of an Institutional Strengthening and Streamlining Program for the Executive Branch" which created the Presidential Committee on Executive Governance (PCEG) composed of the Executive Secretary as chair and the Secretary of the Department of Budget and Management (DBM) as co-chair.

The DBM, on July 8, 2000, issued the Notice of Organization, Staffing and Compensation Action (NOSCA). On July 17, 2000, the PCEG likewise issued Memorandum Circular (M.C.) No. 62, entitled "Implementing Executive Order No. 102, Series of 1999 Redirecting the Functions and Operations of the Department of Health."2 M.C. No. 62 directed the rationalization and streamlining of the said Department.

On July 24, 2000, the Secretary of Health issued Department Memorandum No. 136, Series of 2000, ordering the Undersecretary, Assistant Secretaries, Bureau or Service Directors and Program Managers of the Department of Health to direct all employees under their respective offices to accomplish and submit the Personal Information Sheet due to the approval of the Department of Health – Rationalization and Streamlining Plan.

On July 28, 2000, the Secretary of Health again issued Department Circular No. 221, Series of 2000, stating that the Department will start implementing the Rationalization and Streamlining Plan by a process of selection, placement or matching of personnel to the approved organizational chart and the list of the approved plantilla items.3 The Secretary also issued Administrative Order (A.O.) No. 94, Series of 2000, which set the implementing guidelines for the restructuring process on personnel selection and

placement, retirement and/or voluntary resignation. A.O. No. 94 outlined the general guidelines for the selection and placement of employees adopting the procedures and standards set forth in R.A. No. 66564 or the "Rules on Governmental Reorganization," Civil Service Rules and Regulations, Sections 76 to 78 of the GAA for the Year 2000, and Section 42 of E.O. No. 292.

On August 29, 2000, the Secretary of Health issued Department Memorandum No. 157, Series of 2000, viz.:

Pursuant to the Notice of Organization, Staffing and Compensation Action (NOSCA) approved by the DBM on 8 July 2000 and Memorandum Circular No. 62 issued by the Presidential Committee on Effective Governance (PCEG) on 17 July 2000, Implementing E.O. 102 dated 24 May 1999, the following approved Placement List of DOH Personnel is hereby disseminated for your information and guidance.

All personnel are hereby directed to report to their new assignments on or before 2 October 2000 pending processing of new appointments, required clearances and other pertinent documents.

All Heads of Office/Unit in the Department of Health are hereby directed to facilitate the implementation of E.O. 102, to include[,] among others, the transfer or movement of personnel, properties, records and documents to appropriate office/unit and device other necessary means to minimize disruption of office functions and delivery of health services.

Appeals, oversights, issues and concerns of personnel related to this Placement List shall be made in writing using the Appeals Form (available at the Administrative Service) addressed to the Appeals Committee chaired by Dr. Gerardo Bayugo. All Appeals Forms shall be submitted to the Re-Engineering Secretariat xxx not later than 18 September 2000. 5

Petitioner Malaria Employees and Workers Association of the Philippines, Inc. (MEWAP) is a union of affected employees in the Malaria Control Service of the Department of Health. MEWAP filed a complaint, docketed as Civil Case No. 00-98793, with the Regional Trial Court of Manila seeking to nullify Department Memorandum No. 157, the NOSCA and the Placement List of Department of Health Personnel and other issuances implementing E.O. No. 102.

On May 2, 2001, while the civil case was pending at the Regional Trial Court of Manila, Branch 22, petitioners filed with this Court a petition for certiorari under Rule 65 of the Rules of Court. Petitioners sought to nullify E.O. No. 102 for being issued with grave abuse of discretion amounting to lack or excess of jurisdiction as it allegedly violates certain provisions of E.O. No. 292 and R.A. No. 8522. The petition was referred to the Court of Appeals which dismissed the same in its assailed Decision. Hence, this appeal where petitioners ask for a re-examination of the

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pertinent pronouncements of this Court that uphold the authority of the President to reorganize a department, bureau or office in the executive department. Petitioners raise the following issues, viz.:

1. Whether Sections 78 and 80 of the General Provision of Republic Act No. 8522, otherwise known as the General Appropriation[s] Act of 1998[,] empower former President Joseph E. Estrada to reorganize structurally and functionally the Department of Health.

2. Whether Section 20, Chapter I, title i, Book III of the Administrative Code of 1987 provides legal basis in reorganizing the Department of Health.

(A) Whether Presidential Decree No. 1416, as amended by Presidential Decree No. 1772, has been repealed.

3. Whether the President has authority under Section 17, Article VIII of the Constitution to effect a reorganization of a department under the executive branch.

4. Whether there has been abuse of discretion amounting to lack or excess of jurisdiction on the part of former President Joseph E. Estrada in issuing Executive Order No. 102, Redirecting the functions and operations of the Department of Health.

5. Whether Executive Order No. 102 is null and void.6

We deny the petition.

The President has the authority to carry out a reorganization of the Department of Health under the Constitution and statutory laws. This authority is an adjunct of his power of control under Article VII, Sections 1 and 17 of the 1987 Constitution, viz.:

Section 1. The executive power shall be vested in the President of the Philippines.

Section 17. The President shall have control of all the executive departments, bureaus and offices. He shall ensure that the laws be faithfully executed.

In Canonizado v. Aguirre,7 we held that reorganization "involves the reduction of personnel, consolidation of offices, or abolition thereof by reason of economy or redundancy of functions." It alters the existing structure of government offices or units therein, including the lines of control, authority and responsibility between them.8While the power to abolish an office is generally lodged with the legislature, the authority of

the President to reorganize the executive branch, which may include such abolition, is permissible under our present laws, viz.:

The general rule has always been that the power to abolish a public office is lodged with the legislature.This proceeds from the legal precept that the power to create includes the power to destroy. A public office is either created by the Constitution, by statute, or by authority of law. Thus, except where the office was created by the Constitution itself, it may be abolished by the same legislature that brought it into existence.

The exception, however, is that as far as bureaus, agencies or offices in the executive department are concerned, the President’s power of control may justify him to inactivate the functions of a particular office, or certain laws may grant him the broad authority to carry out reorganization measures.9

The President’s power to reorganize the executive branch is also an exercise of his residual powers under Section 20, Title I, Book III of E.O. No. 292 which grants the President broad organization powers to implement reorganization measures, viz.:

SEC. 20. Residual Powers. – Unless Congress provides otherwise, the President shall exercise such other powers and functions vested in the President which are provided for under the laws and which are not specifically enumerated above, or which are not delegated by the President in accordance with law.10

We explained the nature of the President’s residual powers under this section in the case of Larin v. Executive Secretary, 11 viz.:

This provision speaks of such other powers vested in the President under the law. What law then gives him the power to reorganize? It is Presidential Decree No. 1772 which amended Presidential Decree No. 1416. These decrees expressly grant the President of the Philippines the continuing authority to reorganize the national government, which includes the power to group, consolidate bureaus and agencies, to abolish offices, to transfer functions, to create and classify functions, services and activities and to standardize salaries and materials. The validity of these two decrees [is] unquestionable. The 1987 Constitution clearly provides that "all laws, decrees, executive orders, proclamations, letters of instructions and other executive issuances not inconsistent with this Constitution shall remain operative until amended, repealed or revoked." So far, there is yet no law amending or repealing said decrees.12

The pertinent provisions of Presidential Decree No. 1416, as amended by Presidential Decree No. 1772, clearly support the President’s continuing power to reorganize the executive branch, viz.:

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1. The President of the Philippines shall have continuing authority to reorganize the National Government. In exercising this authority, the President shall be guided by generally acceptable principles of good government and responsive national development, including but not limited to the following guidelines for a more efficient, effective, economical and development-oriented governmental framework:

b) Abolish departments, offices, agencies or functions which may not be necessary, or create those which are necessary, for the efficient conduct of government functions, services and activities;

c) Transfer functions, appropriations, equipment, properties, records and personnel from one department, bureau, office, agency or instrumentality to another;

d) Create, classify, combine, split, and abolish positions;

e) Standardize salaries, materials, and equipment;

f) Create, abolish, group, consolidate, merge, or integrate entities, agencies, instrumentalities, and units of the National Government, as well as expand, amend, change, or otherwise modify their powers, functions, and authorities, including, with respect to government-owned or controlled corporations, their corporate life, capitalization, and other relevant aspects of their charters;

g) Take such other related actions as may be necessary to carry out the purposes and objectives of this Decree.

Petitioners argue that the residual powers of the President under Section 20, Title I, Book III of E.O. No. 292 refer only to the Office of the President and not to the departments, bureaus or offices within the executive branch. They invoke Section 31, Chapter 10, Title III, Book III of the same law, viz.:

Section 31. Continuing Authority of the President to Reorganize his Office. – The President, subject to the policy in the Executive Office and in order to achieve simplicity, economy and efficiency, shall have continuing authority to reorganize the administrative structure of the Office of the President. x x x

The interpretation of petitioners is illogically restrictive and lacks legal basis. The residual powers granted to the President under Section 20, Title I, Book III are too broad to be construed as having a sole application to the Office of the President. As correctly stated by respondents, there is nothing in E.O. No. 292 which provides that the continuing authority should apply only to the Office of the President.13 If such was the intent of the law, the same should have been expressly stated. To adopt the argument of petitioners would result to two conflicting provisions in one statute. It is a basic canon of statutory construction that in interpreting a statute, care should be

taken that every part thereof be given effect, on the theory that it was enacted as an integrated measure and not as a hodge-podge of conflicting provisions. The rule is that a construction that would render a provision inoperative should be avoided; instead, apparently inconsistent provisions should be reconciled whenever possible as parts of a coordinated and harmonious whole.14

In fact, as pointed out by respondents, the President’s power to reorganize the executive department even finds further basis under Sections 78 and 80 of R.A. No. 8522, viz.:15

Section 78. Organizational Changes – Unless otherwise provided by law or directed by the President of the Philippines, no organizational unit or changes in key positions in any department or agency shall be authorized in their respective organizational structure and funded from appropriations provided by this Act.

Section 80. Scaling Down and Phase-out of Activities of Agencies within the Executive Branch – The heads of departments, bureaus, offices and agencies are hereby directed to identify their respective activities which are no longer essential in the delivery of public services and which may be scaled down, phased-out or abolished subject to Civil Service rules and regulations. Said activities shall be reported to the Office of the President through the Department of Budget and Management and to the Chairman, Committee on Appropriations of the House of Representatives and the Chairman, Committee on Finance of the Senate. Actual scaling down, phase-out or abolition of the activities shall be effected pursuant to Circulars or Orders issued for the purpose by the Office of the President.

Petitioners contend that Section 78 refers only to changes in "organizational units" or "key positions" in any department or agency, while Section 80 refers merely to scaling down and phasing out of "activities" within the executive department. They argue that neither section authorizes reorganization. Thus, the realignment of the appropriations to implement the reorganization of the Department of Health under E.O. No. 102 is illegal.

Again, petitioners’ construction of the law is unduly restrictive. This Court has consistently held in Larin16 andBuklod ng Kawanihang EIIB v. Zamora17 that the corresponding pertinent provisions in the GAA in these subject cases authorize the President to effect organizational changes in the department or agency concerned.

Be that as it may, the President must exercise good faith in carrying out the reorganization of any branch or agency of the executive department. Reorganization is effected in good faith if it is for the purpose of economy or to make bureaucracy more efficient.18 R.A. No. 665619 provides for the circumstances which may be considered as evidence of bad faith in the removal of civil service employees made as a result of reorganization, to wit: (a)where there is a significant increase in the number of positions in the new staffing pattern of the department or agency

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concerned; (b) where an office is abolished and another performing substantially the same functions is created; (c) where incumbents are replaced by those less qualified in terms of status of appointment, performance and merit; (d) where there is a classification of offices in the department or agency concerned and the reclassified offices perform substantially the same functions as the original offices; and (e) where the removal violates the order of separation.

We agree with the ruling of the Court of Appeals that the President did not commit bad faith in the questioned reorganization, viz.:

In this particular case, there is no showing that the reorganization undertaking in the [Department of Health] had violated this requirement, nor [are] there adequate allegations to that effect. It is only alleged that the petitioners were directly affected by the reorganization ordered under E.O. [No.] 102. Absent is any showing that bad faith attended the actual implementation of the said presidential issuance.

IN VIEW WHEREOF, the petition is DENIED. The assailed Decision of the Court of Appeals in CA-G.R. SP No. 65475 dated September 12, 2003 is AFFIRMED.

G.R. No. 196425               July 24, 2012

PROSPERO A. PICHAY, JR., Petitioner, vs.OFFICE OF THE DEPUTY EXECUTIVE SECRETARY FOR LEGAL AFFAIRS INVESTIGATIVE AND ADJUDICATORY DIVISION, HON. PAQUITO N. OCHOA, JR., in his capacity as Executive Secretary, and HON. CESAR V. PURISIMA, Respondents.

The Case

This is a Petition for Certiorari and Prohibition with a prayer for the issuance of a temporary restraining order, seeking to declare as unconstitutional Executive Order No. 13, entitled, "Abolishing the Presidential Anti-Graft Commission and Transferring Its Investigative, Adjudicatory and Recommendatory Functions to the Office Of The Deputy Executive Secretary For Legal Affairs, Office of the President",1 and to permanently prohibit respondents from administratively proceeding against petitioner on the strength of the assailed executive order.

The Facts

On April 16, 2001, then President Gloria Macapagal-Arroyo issued Executive Order No. 12 (E.O. 12) creating the Presidential Anti-Graft Commission (PAGC) and vesting

it with the power to investigate or hear administrative cases or complaints for possible graft and corruption, among others, against presidential appointees and to submit its report and recommendations to the President. Pertinent portions of E.O. 12 provide:

Section 4. Jurisdiction, Powers and Functions. –

(b) The Commission, acting as a collegial body, shall have the authority to investigate or hear administrative cases or complaints against all presidential appointees in the government and any of its agencies or instrumentalities xxx

Section 8. Submission of Report and Recommendations. – After completing its investigation or hearing, the Commission en banc shall submit its report and recommendations to the President. The report and recommendations shall state, among others, the factual findings and legal conclusions, as well as the penalty recommend (sic) to be imposed or such other action that may be taken."

On November 15, 2010, President Benigno Simeon Aquino III issued Executive Order No. 13 (E.O. 13), abolishing the PAGC and transferring its functions to the Office of the Deputy Executive Secretary for Legal Affairs (ODESLA), more particularly to its newly-established Investigative and Adjudicatory Division (IAD). The full text of the assailed executive order reads:

EXECUTIVE ORDER NO. 13

ABOLISHING THE PRESIDENTIAL ANTI-GRAFT COMMISSION AND TRANSFERRING ITS INVESTIGATIVE, ADJUDICATORY AND RECOMMENDATORY FUNCTIONS TO THE OFFICE OF THE DEPUTY EXECUTIVE SECRETARY FOR LEGAL AFFAIRS, OFFICE OF THE PRESIDENT

WHEREAS, this administration has a continuing mandate and advocacy to fight and eradicate corruption in the different departments, bureaus, offices and other government agencies and instrumentalities;

WHEREAS, the government adopted a policy of streamlining the government bureaucracy to promote economy and efficiency in government;

WHEREAS, Section VII of the 1987 Philippine Constitution provides that the President shall have control of all the executive departments, bureaus and offices;

WHEREAS, Section 31 Chapter 10, Title III, Book III of Executive Order 292 (Administrative Code of 1987) provides for the continuing authority of the President to reorganize the administrative structure of the Office of the President;

WHEREAS, Presidential Decree (PD) No. 1416 (Granting Continuing Authority to the President of the Philippines to Reorganize the National Government), as amended by

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PD 1722, provides that the President of the Philippines shall have continuing authority to reorganize the administrative structure of the National Government and may, at his discretion, create, abolish, group, consolidate, merge or integrate entities, agencies, instrumentalities and units of the National Government, as well as, expand, amend, change or otherwise modify their powers, functions and authorities;

WHEREAS, Section 78 of the General Provisions of Republic Act No. 9970 (General Appropriations Act of 2010) authorizes the President of the Philippines to direct changes in the organizational units or key positions in any department or agency;

NOW, THEREFORE, I, BENIGNO S. AQUINO III, President of the Philippines, by virtue of the powers vested in me by law, do hereby order the following:

SECTION 1. Declaration of Policy. It is the policy of the government to fight and eradicate graft and corruption in the different departments, bureaus, offices and other government agencies and instrumentalities.

The government adopted a policy of streamlining the government bureaucracy to promote economy and efficiency in the government.

SECTION 2. Abolition of Presidential Anti-Graft Commission (PAGC). To enable the Office of the President (OP) to directly investigate graft and corrupt cases of Presidential appointees in the Executive Department including heads of government-owned and controlled corporations, the

Presidential Anti-Graft Commission (PAGC) is hereby abolished and their vital functions and other powers and functions inherent or incidental thereto, transferred to the Office of the Deputy Executive Secretary for Legal Affairs (ODESLA), OP in accordance with the provisions of this Executive Order.

SECTION 3. Restructuring of the Office of the Deputy Executive Secretary for Legal Affairs, OP. In addition to the Legal and Legislative Divisions of the ODESLA, the Investigative and Adjudicatory Division shall be created.

The newly created Investigative and Adjudicatory Division shall perform powers, functions and duties mentioned in Section 2 hereof, of PAGC.

The Deputy Executive Secretary for Legal Affairs (DESLA) will be the recommending authority to the President, thru the Executive Secretary, for approval, adoption or modification of the report and recommendations of the Investigative and Adjudicatory Division of ODESLA.

SECTION 4. Personnel Who May Be Affected By the Abolition of PAGC. The personnel who may be affected by the abolition of the PAGC shall be allowed to avail of the benefits provided under existing laws if applicable. The Department of Budget

and Management (DBM) is hereby ordered to release the necessary funds for the benefits of the employees.

SECTION 5. Winding Up of the Operation and Disposition of the Functions, Positions, Personnel, Assets and Liabilities of PAGC. The winding up of the operations of PAGC including the final disposition or transfer of their functions, positions, personnel, assets and liabilities as may be necessary, shall be in accordance with the applicable provision(s) of the Rules and Regulations Implementing EO 72 (Rationalizing the Agencies Under or Attached to the Office of the President) dated March 15, 2002. The winding up shall be implemented not later than 31 December 2010.

The Office of the Executive Secretary, with the assistance of the Department of Budget and Management, shall ensure the smooth and efficient implementation of the dispositive actions and winding-up of the activities of PAGC.

SECTION 6. Repealing Clause. All executive orders, rules, regulations and other issuances or parts thereof, which are inconsistent with the provisions of this Executive Order, are hereby revoked or modified accordingly.

SECTION 7. Effectivity. This Executive Order shall take effect immediately after its publication in a newspaper of general circulation.

On April 6, 2011, respondent Finance Secretary Cesar V. Purisima filed before the IAD-ODESLA a complaint affidavit2 for grave misconduct against petitioner Prospero A. Pichay, Jr., Chairman of the Board of Trustees of the Local Water Utilities Administration (LWUA), as well as the incumbent members of the LWUA Board of Trustees, namely, Renato Velasco, Susana Dumlao Vargas, Bonifacio Mario M. Pena, Sr. and Daniel Landingin, which arose from the purchase by the LWUA of Four Hundred Forty-Five Thousand Three Hundred Seventy Seven (445,377) shares of stock of Express Savings Bank, Inc.

On April 14, 2011, petitioner received an Order3 signed by Executive Secretary Paquito N. Ochoa, Jr. requiring him and his co-respondents to submit their respective written explanations under oath. In compliance therewith, petitioner filed a Motion to Dismiss Ex Abundante Ad Cautelam manifesting that a case involving the same transaction and charge of grave misconduct entitled, "Rustico B. Tutol, et al. v. Prospero Pichay, et al.", and docketed as OMB-C-A-10-0426-I, is already pending before the Office of the Ombudsman.

Now alleging that no other plain, speedy and adequate remedy is available to him in the ordinary course of law, petitioner has resorted to the instant petition for certiorari and prohibition upon the following grounds:

I. E.O. 13 IS UNCONSTITUTIONAL FOR USURPING THE POWER OF THE LEGISLATURE TO CREATE A PUBLIC OFFICE.

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II. E.O. 13 IS UNCONSTITUTIONAL FOR USURPING THE POWER OF THE LEGISLATURE TO APPROPRIATE FUNDS.

III. E.O. 13 IS UNCONSTITUTIONAL FOR USURPING THE POWER OF CONGRESS TO DELEGATE QUASI-JUDICIAL POWERS TO ADMINISTRATIVE AGENCIES.

IV. E.O. 13 IS UNCONSTITUTIONAL FOR ENCROACHING UPON THE POWERS OF THE OMBUDSMAN.

V. E.O. 13 IS UNCONSTITUTIONAL FOR VIOLATING THE GUARANTEE OF DUE PROCESS.

VI. E.O. 13 IS UNCONSTITUTIONAL FOR VIOLATING THE EQUAL PROTECTION CLAUSE.

Our Ruling

In assailing the constitutionality of E.O. 13, petitioner asseverates that the President is not authorized under any existing law to create the Investigative and Adjudicatory Division, Office of the Deputy Executive Secretary for Legal Affairs (IAD-ODESLA) and that by creating a new, additional and distinct office tasked with quasi-judicial functions, the President has not only usurped the powers of congress to create a public office, appropriate funds and delegate quasi-judicial functions to administrative agencies but has also encroached upon the powers of the Ombudsman. Petitioner avers that the unconstitutionality of E.O. 13 is also evident when weighed against the due process requirement and equal protection clause under the 1987 Constitution.

The contentions are unavailing.

The President has Continuing Authority to Reorganize the Executive Department under E.O. 292.

Section 31 of Executive Order No. 292 (E.O. 292), otherwise known as the Administrative Code of 1987, vests in the President the continuing authority to reorganize the offices under him in order to achieve simplicity, economy and efficiency. E.O. 292 sanctions the following actions undertaken for such purpose:

(1)Restructure the internal organization of the Office of the President Proper, including the immediate Offices, the Presidential Special Assistants/Advisers System and the Common Staff Support System, by abolishing, consolidating, or merging units thereof or transferring functions from one unit to another;

(2)Transfer any function under the Office of the President to any other Department or Agency as well as transfer functions to the Office of the President from other Departments and Agencies; and

(3)Transfer any agency under the Office of the President to any other Department or Agency as well as transfer agencies to the Office of the President from other departments or agencies.4

In the case of Buklod ng Kawaning EIIB v. Zamora5 the Court affirmed that the President's authority to carry out a reorganization in any branch or agency of the executive department is an express grant by the legislature by virtue of E.O. 292, thus:

But of course, the list of legal basis authorizing the President to reorganize any department or agency in the executive branch does not have to end here. We must not lose sight of the very source of the power – that which constitutes an express grant of power. Under Section 31, Book III of Executive Order No. 292 (otherwise known as the Administrative Code of 1987), "the President, subject to the policy of the Executive Office and in order to achieve simplicity, economy and efficiency, shall have the continuing authority to reorganize the administrative structure of the Office of the President." For this purpose, he may transfer the functions of other Departments or Agencies to the Office of the President. (Emphasis supplied)

And in Domingo v. Zamora,6 the Court gave the rationale behind the President's continuing authority in this wise:

The law grants the President this power in recognition of the recurring need of every President to reorganize his office "to achieve simplicity, economy and efficiency." The Office of the President is the nerve center of the Executive Branch. To remain effective and efficient, the Office of the President must be capable of being shaped and reshaped by the President in the manner he deems fit to carry out his directives and policies. After all, the Office of the President is the command post of the President. (Emphasis supplied)

Clearly, the abolition of the PAGC and the transfer of its functions to a division specially created within the ODESLA is properly within the prerogative of the President under his continuing "delegated legislative authority to reorganize" his own office pursuant to E.O. 292.

Generally, this authority to implement organizational changes is limited to transferring either an office or a function from the Office of the President to another Department or Agency, and the other way around.7

Only Section 31(1) gives the President a virtual freehand in dealing with the internal structure of the Office of the President Proper by allowing him to take actions as extreme as abolition, consolidation or merger of units, apart from the less drastic

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move of transferring functions and offices from one unit to another. Again, in Domingo v. Zamora8 the Court noted:

However, the President's power to reorganize the Office of the President under Section 31 (2) and (3) of EO 292 should be distinguished from his power to reorganize the Office of the President Proper. Under Section 31 (1) of EO 292, the President can reorganize the Office of the President Proper by abolishing, consolidating or merging units, or by transferring functions from one unit to another. In contrast, under Section 31 (2) and (3) of EO 292, the President's power to reorganize offices outside the Office of the President Proper but still within the Office of the

President is limited to merely transferring functions or agencies from the Office of the President to Departments or Agencies, and vice versa.

The distinction between the allowable organizational actions under Section 31(1) on the one hand and Section 31 (2) and (3) on the other is crucial not only as it affects employees' tenurial security but also insofar as it touches upon the validity of the reorganization, that is, whether the executive actions undertaken fall within the limitations prescribed under E.O. 292. When the PAGC was created under E.O. 12, it was composed of a Chairman and two (2) Commissioners who held the ranks of Presidential Assistant II and I, respectively,9 and was placed directly "under the Office of the President."10 On the other hand, the ODESLA, to which the functions of the PAGC have now been transferred, is an office within the Office of the President Proper.11 Since both of these offices belong to the Office of the President Proper, the reorganization by way of abolishing the PAGC and transferring its functions to the ODESLA is allowable under Section 31 (1) of E.O. 292.

Petitioner, however, goes on to assert that the President went beyond the authority granted by E.O. 292 for him to reorganize the executive department since his issuance of E.O. 13 did not merely involve the abolition of an office but the creation of one as well. He argues that nowhere in the legal definition laid down by the Court in several cases does a reorganization include the act of creating an office.

The contention is misplaced.

The Reorganization Did not Entail the Creation of a New, Separate and Distinct Office.

The abolition of the PAGC did not require the creation of a new, additional and distinct office as the duties and functions that pertained to the defunct anti-graft body were simply transferred to the ODESLA, which is an existing office within the Office of the President Proper. The reorganization required no more than a mere alteration of the administrative structure of the ODESLA through the establishment of a third division – the Investigative and Adjudicatory Division – through which ODESLA could take on the additional functions it has been tasked to discharge under E.O. 13. In Canonizado v. Aguirre,12 We ruled that –

Reorganization takes place when there is an alteration of the existing structure of government offices or units therein, including the lines of control, authority and responsibility between them. It involves a reduction of personnel, consolidation of offices, or abolition thereof by reason of economy or redundancy of functions.

The Reorganization was Pursued in Good Faith.

A valid reorganization must not only be exercised through legitimate authority but must also be pursued in good faith. A reorganization is said to be carried out in good faith if it is done for purposes of economy and efficiency.13It appears in this case that the streamlining of functions within the Office of the President Proper was pursued with such purposes in mind.

In its Whereas clauses, E.O. 13 cites as bases for the reorganization the policy dictates of eradicating corruption in the government and promoting economy and efficiency in the bureaucracy. Indeed, the economical effects of the reorganization is shown by the fact that while Congress had initially appropriated P22 Million for the PAGC's operation in the 2010 annual budget,14 no separate or added funding of such a considerable amount was ever required after the transfer of the PAGC functions to the IAD-ODESLA.

Apparently, the budgetary requirements that the IAD-ODESLA needed to discharge its functions and maintain its personnel would be sourced from the following year's appropriation for the President's Offices under the General Appropriations Act of 2011.15 Petitioner asseverates, however, that since Congress did not indicate the manner by which the appropriation for the Office of the President was to be distributed, taking therefrom the operational funds of the IAD-ODESLA would amount to an illegal appropriation by the President. The contention is without legal basis.

There is no usurpation of the legislative power to appropriate public funds.

In the chief executive dwell the powers to run government. Placed upon him is the power to recommend the budget necessary for the operation of the Government,16 which implies that he has the necessary authority to evaluate and determine the structure that each government agency in the executive department would need to operate in the most economical and efficient manner.17 Hence, the express recognition under Section 78 of R.A. 9970 or the General Appropriations Act of 2010 of the President’s authority to "direct changes in the organizational units or key positions in any department or agency." The aforecited provision, often and consistently included in the general appropriations laws, recognizes the extent of the President’s power to reorganize the executive offices and agencies under him, which is, "even to the extent of modifying and realigning appropriations for that purpose."18

And to further enable the President to run the affairs of the executive department, he is likewise given constitutional authority to augment any item in the General Appropriations Law using the savings in other items of the appropriation for his

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office.19 In fact, he is explicitly allowed by law to transfer any fund appropriated for the different departments, bureaus, offices and agencies of the Executive Department which is included in the General Appropriations Act, to any program, project or activity of any department, bureau or office included in the General Appropriations Act or approved after its enactment.20

Thus, while there may be no specific amount earmarked for the IAD-ODESLA from the total amount appropriated by Congress in the annual budget for the Office of the President, the necessary funds for the IAD-ODESLA may be properly sourced from the President's own office budget without committing any illegal appropriation. After all, there is no usurpation of the legislature's power to appropriate funds when the President simply allocates the existing funds previously appropriated by Congress for his office.

The IAD-ODESLA is a fact-finding and recommendatory body not vested with quasi-judicial powers.

Petitioner next avers that the IAD-ODESLA was illegally vested with judicial power which is reserved to the Judicial Department and, by way of exception through an express grant by the legislature, to administrative agencies. He points out that the name Investigative and Adjudicatory Division is proof itself that the IAD-ODESLA wields quasi-judicial power.

The argument is tenuous. As the OSG aptly explained in its Comment,21 while the term "adjudicatory" appears part of its appellation, the IAD-ODESLA cannot try and resolve cases, its authority being limited to the conduct of investigations, preparation of reports and submission of recommendations. E.O. 13 explicitly states that the IAD-ODESLA shall "perform powers, functions and duties xxx, of PAGC."22

Under E.O. 12, the PAGC was given the authority to "investigate or hear administrative cases or complaints against all presidential appointees in the government"23 and to "submit its report and recommendations to the President."24 The IAD-ODESLA is a fact-finding and recommendatory body to the President, not having the power to settle controversies and adjudicate cases. As the Court ruled in Cariño v. Commission on Human Rights,25 and later reiterated in Biraogo v. The Philippine Truth Commission:26

Fact-finding is not adjudication and it cannot be likened to the judicial function of a court of justice, or even a quasi-judicial agency or office. The function of receiving evidence and ascertaining therefrom the facts of a controversy is not a judicial function. To be considered as such, the act of receiving evidence and arriving at factual conclusions in a controversy must be accompanied by the authority of applying the law to the factual conclusions to the end that the controversy may be decided or determined authoritatively, finally and definitively, subject to such appeals or modes of review as may be provided by law.

The President's authority to issue E.O. 13 and constitute the IAD-ODESLA as his fact-finding investigator cannot be doubted. After all, as Chief Executive, he is granted full control over the Executive Department to ensure the enforcement of the laws. Section 17, Article VII of the Constitution provides:

Section 17. The President shall have control of all the executive departments, bureaus and offices. He shall ensure that the laws be faithfully executed.

The obligation to see to it that laws are faithfully executed necessitates the corresponding power in the President to conduct investigations into the conduct of officials and employees in the executive department.27

The IAD-ODESLA does not encroach upon the powers and duties of the Ombudsman.

Contrary to petitioner's contention, the IAD-ODESLA did not encroach upon the Ombudsman's primary jurisdiction when it took cognizance of the complaint affidavit filed against him notwithstanding the earlier filing of criminal and administrative cases involving the same charges and allegations before the Office of the Ombudsman. The primary jurisdiction of the Ombudsman to investigate and prosecute cases refers to criminal cases cognizable by the Sandiganbayan and not to administrative cases. It is only in the exercise of its primary jurisdiction that the Ombudsman may, at any time, take over the investigation being conducted by another investigatory agency. Section 15 (1) of R.A. No. 6770 or the Ombudsman Act of 1989, empowers the Ombudsman to –

(1)Investigate and prosecute on its own or on complaint by any person, any act or omission of any public officer or employee, office or agency, when such act or omission appears to be illegal, unjust, improper or inefficient. It has primary jurisdiction over cases cognizable by the Sandiganbayan and, in the exercise of its primary jurisdiction, it may take over, at any stage, from any investigatory agency of government, the investigation of such cases. (Emphasis supplied)

Since the case filed before the IAD-ODESLA is an administrative disciplinary case for grave misconduct, petitioner may not invoke the primary jurisdiction of the Ombudsman to prevent the IAD-ODESLA from proceeding with its investigation. In any event, the Ombudsman's authority to investigate both elective and appointive officials in the government, extensive as it may be, is by no means exclusive. It is shared with other similarly authorized government agencies.28

While the Ombudsman's function goes into the determination of the existence of probable cause and the adjudication of the merits of a criminal accusation, the investigative authority of the IAD- ODESLA is limited to that of a fact-finding investigator whose determinations and recommendations remain so until acted upon by the President. As such, it commits no usurpation of the Ombudsman's constitutional duties.

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Executive Order No. 13 Does Not Violate Petitioner's Right to Due Process and the Equal Protection of the Laws.

Petitioner goes on to assail E.O. 13 as violative of the equal protection clause pointing to the arbitrariness of limiting the IAD-ODESLA's investigation only to presidential appointees occupying upper-level positions in the government. The equal protection of the laws is a guaranty against any form of undue favoritism or hostility from the government.29 It is embraced under the due process concept and simply requires that, in the application of the law, "all persons or things similarly situated should be treated alike, both as to rights conferred and responsibilities imposed."30 The equal protection clause, however, is not absolute but subject to reasonable classification so that aggrupations bearing substantial distinctions may be treated differently from each other. This we ruled in Farinas v. Executive Secretary,31 wherein we further stated that –

The equal protection of the law clause is against undue favor and individual or class privilege, as well as hostile discrimination or the oppression of inequality. It is not intended to prohibit legislation which is limited either in the object to which it is directed or by territory within which it is to operate. It does not demand absolute equality among residents; it merely requires that all persons shall be treated alike, under like circumstances and conditions both as to privileges conferred and liabilities enforced. The equal protection clause is not infringed by legislation which applies only to those persons falling within a specified class, if it applies alike to all persons within such class, and reasonable grounds exist for making a distinction between those who fall within such class and those who do not. (Emphasis supplied)

Presidential appointees come under the direct disciplining authority of the President. This proceeds from the well settled principle that, in the absence of a contrary law, the power to remove or to discipline is lodged in the same authority on which the power to appoint is vested.32 Having the power to remove and/or discipline presidential appointees, the President has the corollary authority to investigate such public officials and look into their conduct in office.33 Petitioner is a presidential appointee occupying the high-level position of Chairman of the LWUA. Necessarily, he comes under the disciplinary jurisdiction of the President, who is well within his right to order an investigation into matters that require his informed decision.

There are substantial distinctions that set apart presidential appointees occupying upper-level positions in government from non-presidential appointees and those that occupy the lower positions in government. In Salumbides v. Office of the Ombudsman,34 we had ruled extensively on the substantial distinctions that exist between elective and appointive public officials, thus:

Substantial distinctions clearly exist between elective officials and appointive officials. The former occupy their office by virtue of the mandate of the electorate. They are elected to an office for a definite term and may be removed therefrom only upon stringent conditions. On the other hand, appointive officials hold their office by virtue of their designation thereto by an appointing authority. Some appointive officials hold

their office in a permanent capacity and are entitled to security of tenure while others serve at the pleasure of the appointing authority.

x x x x

An election is the embodiment of the popular will, perhaps the purest expression of the sovereign power of the people. 1âwphi1 It involves the choice or selection of candidates to public office by popular vote. Considering that elected officials are put in office by their constituents for a definite term, x x x complete deference is accorded to the will of the electorate that they be served by such officials until the end of the term for which they were elected. In contrast, there is no such expectation insofar as appointed officials are concerned. (Emphasis supplied)

Also, contrary to petitioner's assertions, his right to due process was not violated when the IAD-ODESLA took cognizance of the administrative complaint against him since he was given sufficient opportunity to oppose the formal complaint filed by Secretary Purisima. In administrative proceedings, the filing of charges and giving reasonable opportunity for the person so charged to answer the accusations against him constitute the minimum requirements of due process,35 which simply means having the opportunity to explain one’s side.36 Hence, as long as petitioner was given the opportunity to explain his side and present evidence, the requirements of due process are satisfactorily complied with because what the law abhors is an absolute lack of opportunity to be heard.37 The records show that petitioner was issued an Order requiring him to submit his written explanation under oath with respect to the charge of grave misconduct filed against him. His own failure to submit his explanation despite notice defeats his subsequent claim of denial of due process.

Finally, petitioner doubts that the IAD-ODESLA can lawfully perform its duties as an impartial tribunal, contending that both the IAD-ODESLA and respondent Secretary Purisima are connected to the President. The mere suspicion of partiality will not suffice to invalidate the actions of the IAD-ODESLA. Mere allegation is not equivalent to proof. Bias and partiality

cannot be presumed.38 Petitioner must present substantial proof to show that the lAD-ODES LA had unjustifiably sided against him in the conduct of the investigation. No such evidence has been presented as to defeat the presumption of regularity m the performance of the fact-finding investigator's duties. The assertion, therefore, deserves scant consideration.

Every law has in its favor the presumption of constitutionality, and to justify its nullification, there must be a clear and unequivocal breach of the Constitution, not a doubtful and argumentative one.39 Petitioner has failed to discharge the burden of proving the illegality of E.O. 13, which IS indubitably a valid exercise of the President's continuing authority to reorganize the Office of the President.

WHEREFORE, premises considered, the petition IS hereby DISMISSED.

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